Give your employees a stake in success

All too often in business, when success is achieved, the accolades are attributed to the owner and not the employees.

However, when the staff is properly evaluated, placed in the appropriate positions, cross trained to prevent boredom, and treated fairly by management, shop productivity and business profitability usually improve. And it is the staff that is responsible for much of that success, not just the owner.

In February 2006, I bought Vermont Custom Cabinetry from its founder who had owned the company for 25 years. The business was small, with only seven employees, but had earned a reputation for making top-quality cabinetry primarily for the residential market, selling to a network of kitchen and bath dealers throughout New England. In order to ensure a smooth transition, I signed the previous owner to a two-year consulting contract. Because he had been the shop floor manager, and I had no woodworking background, I assumed I would need him to help direct the staff until a replacement could be found.

The biggest surprise after taking over was the quality and talent of the employees that came with the business. We cut the previous owner loose in less than a year. After a little more than two years, all of the original direct-labor staff are still here, and I can honestly say my most valuable asset is the employees, and they are getting more valuable every day.

Job versatility
Almost from Day One, I discovered a territorial mentality that didn’t foster cooperation between the various cabinetmakers and operators. Cross training was limited, and there was also a lot of gender bias as to what “men’s work” was — working with saws and machines — and what “women’s work” was — sanding and staining. People felt they created job security by not sharing knowledge. In addition, highly skilled cabinetmakers were doing machine work that almost anyone could be trained to do. This created bottlenecks and an unbalanced production line that caused underused people to slow down as they waited for overworked staff to move product on to them.

The first step was to start to peel away low-skilled work from the high-skilled staff and improve cross training. Nobody wants to do the same thing all day long, every day. It creates boredom and lapses in attention to quality. Knock people out of their comfort zone, and let them try new things. In order to do this, it is necessary to foster a supportive and forgiving culture. Mistakes will happen, but if people don’t get their head chewed off every time, they are willing to try.

Through discussion, I learned that the female staff had performed other functions in the past. But over time, as new male staff had been hired, the women had been relegated to sanding and staining. By letting them break out to cabinetmaking functions, their day became more interesting and enjoyable. In addition, the repetitive motion exposure from hand sanding was significantly reduced, and the workforce became much more flexible.

A cross-trained workforce makes your shop much more flexible. By having people that can float to various work stations and continually rebalance the production line, you can add people to areas that are behind and keep the work flowing smoothly. One of the things that attracted me to this business was that it was well laid out. We rent space in an old trucking terminal, which is a long narrow building with lots of garage doors. This means materials can come in on one end of the building and work their way through to the other end to be shipped. This enables us to see where the work is bottlenecked and move people to rebalance the line.

Hidden, underused talent
We were not doing much in the way of glazed, distressed or multi-layer finishes, and the dealer network was clamoring for them. After seeing some of the personal artwork one of the women had done, we had her do some glazed and then distressed finishes. Initially, I tried to over-manage the process to get the right look, which just seemed to cause more rework. Finally we realized there was a certain amount of art to the process. Every job had to be an original and not look manufactured. I had to communicate our customer’s expectations as best as I could, then just back off and let the art happen. As a result, the customer satisfaction feedback has been 100 percent positive.

If you are freeing up highly skilled staff, that enables you to take on more challenging projects. It is not unusual to get requests from customers to do things that other custom cabinet shops have turned down. We pull the key staff together and brainstorm how to do the job. When we have a workable solution, we accept the task. By finding ways to say yes, we have been able to pick up new customers who have been frustrated with their existing suppliers. In addition, highly skilled employees are challenged, and our overall capability improves.

Quality of machinery
One of my early observations was that a lack of maintenance of the equiptment slowed work down. The culture was one of “make due with what you have, and develop ways to work around the problem.” It didn’t take long to realize that by waiting too long to change out blades, sanding belts, filters, hoses, lubricants, etc., you end up paying for it multiple times by creating rework.

Keeping up the maintenance of the equipment lets people know you are working with them and not trying to make it more difficult for them to do good work.

Develop flexible capacity
One of the adages of this business is long lead times are a self-correcting problem. If it takes too long for you to deliver a job, the phone will eventually stop ringing, and you will have all the time you need. In order to create flexible capacity, our base week is a four-day week with 10-hour days. The three-day weekends are appreciated. However, if we get behind we have Friday and Saturday to catch up. 

While most cabinet shops outsource their doors and drawers, we make our own whenever possible. This helps to control the schedule and the quality. If you buy doors for a job, inevitably one or two arrive damaged and you have to wait two weeks for a replacement. If you make your own, you can have a replacement in two hours. Should your lead times increase, you can outsource doors and drawers to raise your capacity. If it is a temporary increase in demand, you can go back to making your own when it passes. If it is a permanent increase, add to your staff to rebalance back to a four-day week and be ready for the next growth spurt. 

Measure throughput
Because it takes several weeks for a custom job to work its way through the shop, and there are several jobs being built simultaneously, it can be difficult to tell if you are being productive enough and making money. In order to track our productivity, we developed a simple measurement system that tells us what percentage of each job is earned each day. At the same time we know our average daily cost or burn rate. As long as your money earned each day is more than your cost, you are obviously making a profit. If not, find the bottlenecks and make the appropriate adjustments.

Life outside of work
If you don’t have a lot of money for wages and benefits, you have to find other ways to compensate staff. Flex time is a great way to give staff a quality of life that is hard to get elsewhere. We let people start as early as they like. If an employee or their child is sick or has a doctor’s appointment, there is no hassle for taking time off. Conversely, it is a two-way street. If there is an important deadline to meet, people are willing to stay, come back in the evening or on weekends. 

Age and maturity
In this day and age that celebrates youth, there is a lot to be said for an older workforce. The ages of the original staff varied from 35 to 67 with an average age of 52. What that has meant is a group with a very mature and responsible attitude toward work. The absenteeism rate is near zero and there are virtually no workplace injuries. Accordingly, we have been rewarded each of the last two years with declining rates for our workers’ compensation insurance. 

The staff does remind me from time to time that they will retire and need to be replaced at some point. We have started that process. With the addition of new employees, the average age is down to about 45. What I do have as we grow is an excellent group of trainers that can teach the next generation.

Communication
One of my observations over the years is that some of the smartest people are the ones who are comfortable that they don’t have all the answers and are willing to show it by asking questions. Conversely, employees that do have the answers appreciate that someone values their opinion and cares to ask. They are generally happy to share what they do know.

This crew has taught me a lot about the cabinet business and a few other useful things about life as well. My job is to listen and make sure they have the tools and resources to do their job.

Tom Westra is the owner of Vermont Custom Cabinetry, a custom cabinet shop in Westminster, Vt., with a staff of 12 full-time employees and four part-time employees.